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A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.)
A. -$150
B. $570
C. $490
D. $900 **Weegy:** 5 600 - 1 700 = 3 900 **User:** Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A. 13.6%
B. 12.5%
C. 36.13%
D. 8.0% **Weegy:** A. 13.6% **User:** Given the following annual net cash flows, determine the IRR to the nearest whole percent of a project with an initial outlay of $1,520.
Year Net Cash Flow
1 $1,000
2 $1,500
3 $ 500
A. 28%
B. 40%
C. 48%
D. 32% **Weegy:** I will provide two answers because it depends on the interpretation.
1. If cash flow starts to bring income in the year of initial outlay: 218.9%
2. [ If cash flow starts to bring income next year from the of initial outlay: 47.7%
Used IRR function in Excel. ] **User:** Your company is considering an investment in a project which would require an initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385 per year. You have determined that the current after-tax cost of the firm’s capital (required rate of return) for each source of financing is as follows:
Cost of debt 8%
Cost of preferred stock 12%
Cost of common stock 16%
Long-term debt currently makes up 20% of the capital structure, preferred stock 10%, and common stock 70%. What is the net present value of this project?
A. $1,568
B. $871
C. $463
D. $1,241 **Weegy:** The answer is D. $1,241. **User:** Which of the following best represents operating income?
A. Income from discontinued operations
B. Income from capital gains
C. Income after financing activities
D. Earnings before interest and taxes **Weegy:** C. Earning before interest and taxes **User:** Forward rates are quoted:
A. on financial statements
B. daily
C. in an indirect form
D. in direct form and at a premium or discount
E. by the FDIC **Weegy:** E. in direct form and at a premium or discount
**User:** According to the hedging principle, permanent assets should be financed with _____ ... (More)

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Asked 8/10/2013 2:52:41 PM

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